Multiple equilibria in Lucas (1990)'s optimal capital taxation model with endogenous learning

Li, Fanghui and Wang, Gaowang (2019): Multiple equilibria in Lucas (1990)'s optimal capital taxation model with endogenous learning.

Abstract

In the paper we solve the general case of the Lucas (1990) optimal capital taxation model with endogenous growth driven by endogenous learning. We prove Lucas (1990)'s conjecture on zero limiting capital tax and display the possibility of multiple equilibria (i.e., multiple BGPs) in the model.

• Item Type: MPRA Paper
• Language: English
• Keywords: Multiple Equilibria; Capital Income Tax; Endogenous Growth; Endogenous Learning
• Subjects: E - Macroeconomics and Monetary Economics > E6 - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook > E62 - Fiscal Policy; H - Public Economics > H2 - Taxation, Subsidies, and Revenue > H21 - Efficiency ; Optimal Taxation

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